Dave Fryer, Product Advocate at Domo, discussed the importance of asking the right questions to create meaningful BI solutions.

At his thought leadership presentation at the 2017 Customer Experience Leadership Forum held in New York on April 20, Fryer observed, “We’re swimming in data. We have this data so we can make decisions. Right? The problem is that a business user employs five to seven different systems to do his or her job. Multiply that by billions, and you’ve got a problem.”

Fryer pointed out that 80% of BI projects fail, according to Forrester. “In my opinion, the reason they fail is because the business user isn’t consulted. Also, data initiatives aren’t a good thing. When we have data initiatives, the first thing we ask is, ‘Where’s the data?’ We pool and collate the data and move it into a box, a database, a warehouse. Once we have the data in this box, we ask, ‘What do we do with it? What can we report on?’ That’s a backwards way of doing it, and that’s why most BI projects fail,” he said.

“Data initiatives aren’t a good thing. When we have data initiatives, the first thing we ask is, ‘Where’s the data?’ We pool and collate the data and move it into a box, a database, a warehouse. Then we ask, ‘What do we do with it?’”

“Let me tell you a story," said Fryer. "I was in M&A for a company in the oil and gas industry. That company had a data initiative. They hired me to figure out how they could be more data-driven in their decision-making process. I asked, ‘Where’s your data?’ and they showed me all their different systems. I proposed plugging into all the different systems, bringing that all together into a database, and building a model to show past performance, current status, and forecast into the next month or quarter. I spent six months and did just that. I delivered the masterpiece. And nobody used it. I wasn’t solving any of their problems because I started with a solution. When it comes to data, you have to start with a problem.”

Fryer continued, “A few months later at that company, my boss came to me and asked if we should buy these stations. I didn’t know. It wasn’t in the model. I didn’t have the data for that,” he said. “One day, I was out eating lunch and it hit me. I had this epiphany that I wasn’t starting with a problem or a question. This is what a lot of BI systems do. They serve data rather than solving business questions. I wrote down on my napkin, ‘What value does buying these stations bring to us?’ The answer was ‘expand our footprint, increase visibility, and increase value.’ This was a legitimate question and provided a meaningful answer. This is the right way to go about reporting in BI,” he stated.

“The next step is asking where the data lives that will help answer that question. If you want to have an effective metric, you have to ask effective questions. Effective metrics are the same as effective questions. Effective questions/metrics have three characteristics: ownership, clarity, and actionability."

“If you want to have an effective metric, you have to ask effective questions. Effective metrics are the same as effective questions.”

Ownership: “There has to be someone responsible for each question, each metric. That person has to be a subject-matter expert, have insight, and be a decision maker. Nine times out of ten, the person asking the question is the owner of that question,” stated Fryer.

Clarity: “The question has to shed light on some obscurity in the organization. This requires asking whether the question is applicable, comprehensive, and reliable.”

Actionable: “Your number can be either green (actionable) or red (not actionable). If there’s no action plan attached to the question you’re asking or metrics you’re consuming, you’re wasting your time.”

In summary, Fryer noted, “Not all metrics are created equal. There are foundational metrics (NPS, customer satisfaction scores, etc.). These aren’t groundbreaking metrics, but they’re necessary. On top of that are indicator metrics that track a specific behavior you want to see in your customers. For customer service, this might be churn. Lastly, there are return metrics, the Holy Grail of analytics. An example of an effective return question for customer experience would be, ‘For every dollar I spend on customer service, what does this do to my NPS?’”

“Lastly, there are return metrics, the Holy Grail of analytics. An example of an effective return question for customer experience would be, ‘For every dollar I spend on customer service, what does this do to my NPS?’”

ABOUT DAVE FRYER:

Dave Fryer has been with Domo for the past two years. Prior to Domo, Dave worked as an entrepreneur-in-residence at Startupbootcamp Mobile in Copenhagen. Here he helped early-stage companies turn their customer and marketing data into early adopters. He has a BS in Business Management with an emphasis in Entrepreneurship from Brigham Young University.